Burger chain seeks financial rescue deal

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Burger chain Byron could close up to 20 restaurants as part of a financial rescue proposal.

KPMG, which is handling the restructuring, confirmed the plan, which could also result in a reduction of the payments of rent to other points of sale.

Any agreement would need the approval of Byron’s creditors, who will be called to vote on the plan, on January 31.

Byron, who has over 70 points of sale, employs approximately 1,800 employees across the united KINGDOM.

KPMG said no restaurants immediately close under the restructuring plan, and that employees, suppliers and business rates wuold continue to be paid on time and in full.

The restructuring to be undertaken pursuant to a so-called company voluntary arrangement (CVA).

Under the proposal, Byron is going to ask the owners of 20 restaurants, including the sites of Manchester and the East end of London, to accept a 55% interest in the rent for six months.Restaurants at risk
Gateshead Metro Centre
Hoxton Square
Manchester Corn Exchange
Manchester Deansgate
Store Street, London
Wandsworth, London
Westbourne Grove, London

During this time, Byron hopes to hold talks with the owners ‘agreement to the basis of any further negotiation of these premises”.

Of its other sites, the company will ask the owners of five points of sale to accept a reduction of rent equivalent to two-thirds.

Byron 51 other restaurants will continue to pay interest rate to the current rate.

Mowie Kay

Will Wright, restructuring partner at KPMG, said: “Over the past 10 years, Byron has grown to become a name in the UK casual dining sector.

“However, in recent times, some parts of the portfolio have not lived up to expectations, and the collection of the economic difficulties starting with the impact of the sector more deeply, the directors undertook a strategic review of the business as a means of safeguarding its long-term future.

“The completion of the financial restructuring…. is designed to address the cost of the lease obligations at the scale of its UK restaurant portfolio.

“As with the same Cva, this provision aims to strike a balance which offers a good compromise for the owners, while allowing the viable part of the business to move forward through a smaller, more profitable core estate.”

The company must obtain at least 75% creditor approval for its CVA.

Last week, House of Fraser has confirmed that it was seeking to reduce rents on some of its stores. The chain of department stores is shortly set to announce its results for the Christmas period.